Indian equity benchmarks snapped
the 6-day losing run, and ended the choppy session up nearly half a per cent on
Monday, on the back of gains in Telecom, Realty and Auto counters. Markets made
cautious start but soon gained traction, as traders took encouragement with
Commerce and Industry Minister Piyush Goyal's statement that the comprehensive
trade agreement between India and the UAE will help in creating huge job
opportunities and boost growth of the domestic economy. The bilateral pact is
expected to increase the bilateral trade in goods to over $100 billion and
trade in services to over $15 billion within five years. Some support also came
in as data provided by the Centre for Monitoring Indian Economy (CMIE) showed
that in one of the largest expansions in the labour market since the beginning
of the pandemic, 8.8 million people joined the country's workforce in April.
However, benchmarks cut most of their initial gains in afternoon session, as
some pessimism came with Reserve Bank of India (RBI) data showed that India's
forex reserves declined by $1.774 billion to $595.954 billion for the week
ended May 6 on the back of a fall in the core currency assets. Some concern
also came as sounding a red alert on India's CPI inflation at an 8-year high
print of 7.79% YoY in April, Acuite Ratings has said it may trigger quicker
rate hikes. Adding some worries, a private report stated that cryptocurrencies
can lead to dollarisation of a part of the economy which would be against
India's sovereign interest. But, key gauges once again entered into green
terrain to end higher, as global markets supported the trading sentiment. Some
support also came from Retailers Association of India (RAI) in its latest
survey stated that retail businesses across India grew 23 per cent in April
2022 in terms of sales as compared to pre-pandemic levels of the same month in
2019 with customers coming back to stores. Besides, the Reserve Bank of India
has said that public sector banks reported over 51 per cent dip in the amount
involved in frauds to Rs 40,295.25 crore during the financial year ended March
2022. Finally, the BSE Sensex rose 180.22 points or 0.34% to 52,973.84 and the
CNX Nifty was up by 60.15 points or 0.38% to 15,842.30.
The US markets ended mostly lower
on Monday after a bit volatile session as some disappointing economic data from
the US, Europe and China weighed on sentiment, prompting investors to largely
stay cautious. New York manufacturing activity unexpectedly contracted in the
month of May, according to a report released by the Federal Reserve Bank of New
York. The New York Fed said its general business conditions index plunged to a
negative 11.6 in May from a positive 24.6 in April. A negative reading
indicates a contraction in regional manufacturing activity. Street had expected
the index to slump to a positive 15.5, which would have still indicated growth
in the sector. A downward revision in EU growth forecast by the European
Commission, and data showing German wholesale price inflation hitting a record
high weighed as well. Meanwhile, Data from the National Bureau of Statistics
showed that China's industrial output contracted 2.9 percent year-on-year in
April, missing expectations for an increase of 0.4 percent and down from 5
percent in March. On the sectoral front, Energy stocks moved higher as crude
oil prices rose sharply on supply concerns and amid bets energy demand in China
will pick up once the Covid lockdowns are lifted. Spirit Airlines shares soared
13.6 percent after JetBlue Airways launched a hostile takeover bid for the
discount carrier. However, JetBlue shares drifted down more than 6 percent.
Crude oil futures ended sharply
higher on Monday on optimism that China will see significant demand recovery
after positive signs that coronavirus pandemic was receding in the hardest-hit
areas. A private report said that Shanghai aims to reopen broadly and allow
normal life to resume for the city's 25 million people from June 1, after declaring
that 15 of its 16 districts had eliminated cases outside quarantine areas.
Further, oil prices also found some support as the European Union's diplomats
and officials expressed optimism about reaching a deal on a phased embargo of
Russian oil despite concerns about supply in eastern Europe. Benchmark crude
oil futures for June delivery surged $3.71 or 3.4% percent to settle at $114.20
a barrel on the New York Mercantile Exchange. Brent crude for July delivery
rose $2.27 or 2.02 percent to settle at $113.82 (Provisional) a barrel on
London's Intercontinental Exchange.
Indian Money market remained closed on Monday on account of
Buddha Purnima.
The FIIs as per Friday's data
were net sellers in both equity and debt segment. In equity segment, the gross
buying was of Rs 5714.13 crore against gross selling of Rs 10524.02 crore,
while in the debt segment, the gross purchase was of Rs 632.50 crore with gross
sales of Rs 972.92 crore. Besides, in the hybrid segment, the gross buying was
of Rs 55.56 crore against gross selling of Rs 57.34 crore.
The US markets ended mostly lower
on Monday after downbeat Chinese economic data added to worries about a global
slowdown and rising interest rates. Asian markets are trading in green on
Tuesday despite a mixed session on Wall Street overnight. Indian markets eked out
mild gains on Monday to halt a losing streak that lasted for six back-to-back
sessions. Gains in financial and auto stocks aided the rebound in both headline
indices, though losses in IT shares limited the upside. Today, markets are
likely to extend previous session's gains with slightly positive start
following gains on Asian counterparts. Investors will also closely monitor the
wholesale price index (WPI) reading for April, that will be announced later in
the day. Some support will come as Sanjiv Bajaj, the newly-elected president of
industry body CII, said the Reserve Bank's decision to raise benchmark interest
rates and the likelihood of a good monsoon will help in containing inflation.
Traders may take note of report that the commerce ministry's investigation arm
DGTR has recommended for continuation of anti-dumping duty on Chinese solar
glass for two years with a view to guard domestic players from cheap imports.
However, there may be some cautiousness as SBI Research in a report said that
amidst the continued rise in inflation, it is now almost certain that the
Reserve Bank of India (RBI) will raise key policy rates in the June and August
policy review meetings, thereby taking it to the pre-pandemic level of 5.15 per
cent by August 2022, and added that even after the rate hikes, inflation will
take time to moderate in India. Adding more pessimism, Foreign Institutional
Investors (FII) were net sellers once again on Monday. FIIs pulled out Rs 1,788
crore from domestic markets. Meanwhile, Prime Minister Narendra Modi held
bilateral talks with his Nepalese counterpart Sher Bahadur Deuba in Lumbini
during which they discussed ways to strengthen ongoing cooperation and develop
new areas in the multifaceted bilateral partnership. After their talks, the two
sides signed six Memorandum of Understandings (MoUs) on cooperation in cultural
and educational sectors. There will be some reaction in agriculture industry
related stocks with a private report that Wheat jumped by the exchange limit to
near a record high after India's move to restrict exports, exposing just how
tight global supplies are during the war in Ukraine and threatening to drive up
food prices even more. State-owned Life Insurance Corporation (LIC) is set to
list its shares on stock exchanges on Tuesday. The shares will be listed on the
Bombay Stock Exchange (BSE) and the National Stock Exchange (NSE). LIC's
highly-anticipated initial public offering (IPO), which lasted from May 4 to
May 9, was subscribed 2.95 times. Investors also awaited the last leg of
corporate earnings for direction.
Support and
Resistance: NSE (Nifty) and BSE (Sensex)
Index
|
Previous close
|
Support
|
Resistance
|
NSE
Nifty
|
15,842.30
|
15,728.65
|
15,966.95
|
BSE
Sensex
|
52,973.84
|
52,594.78
|
53,390.58
|
Nifty Top volumes
Stock
|
Volume
|
Previous close (Rs)
|
Support (Rs)
|
Resistance (Rs)
|
(in Lacs)
|
State Bank of India
|
279.40
|
456.00
|
442.74
|
465.39
|
Tata Motors
|
249.38
|
406.90
|
398.14
|
413.79
|
NTPC
|
162.86
|
148.20
|
143.60
|
150.85
|
Hindalco Industries
|
139.00
|
393.00
|
385.06
|
400.86
|
Oil & Natural Gas Corporation
|
132.05
|
153.90
|
151.71
|
156.16
|
The RBI has conveyed its approval to HDFC Bank for setting up a step-down subsidiary through HDFC Securities, for offering broking and clearing services in IFSC at GIFT City.
NTPC has begun commercial operation of the first part capacity of 20 MW out of 56 MW Kawas Solar PV Project in Gujarat.
HDFC backed proptech firm Reloy is targeting a three-fold jump in its revenue to Rs 13 crore in FY23, helped by expansion to new cities and the addition of more real estate clients.
Bharti Airtel is planning to set up a new technology center in Pune to support digital services in the Western region and will be hiring around 500 digital engineering professionals by the end of the current fiscal.